Are you getting killed with high phone bills every month? Then you might want to consider Voice over Internet Protocol (VoIP), which is hardware and software that allows you to use the internet to make and receive phone calls, usually at a much lower rate than a standard landline.
Here is the gist of VoIP: It converts analog voice signals into data packets using Internet Protocol (IP) instead of the traditional Public Switched Telephone Network, the international telephone system that uses copper wires to carry analog voice data.
VoIP supports real-time, two-way communication capabilities, and calls can typically be made using standard computer audio systems. Some providers support VoIP through standard telephones—and even cellphones—that are outfitted with a special adaptor that connects to a computer network.
What are the pros of VoIP?
- Costs are lower. While your savings will depend on the type of provider you choose, most people realize significant savings when they lose their landlines. PC-to-PC VoIP calls are typically free once you are set up, and while PC-to-phone calls may cost you, they tend to cost much less than phone-to-phone calls.
- Equipment needs are minimal. To set up a VoIP, all you need is a broadband internet connection—which you likely already have—and either a traditional phone with a VoIP adaptor, a VoIP-enabled phone or VoIP software installed on your computer. Forget waiting for the phone guy to come set up your service. Plus, unlike landlines that require the phone company to add or remove lines and additional hardware that can sometimes prove costly, it is a relatively simple, cheap process to scale with a VoIP provider because you can take care of everything through the software.
- Features are comparable to (or sometimes better than) landlines. For example, most providers offer voicemail, conferencing, caller ID, forwarding, three-way calling, unlimited long distance and more. Some VoIPs offer additional features, such as simultaneous ringing, “away” hours or voicemail-to-text transcription.
- Portability is an option. Standard telephone lines are stationary; however, because VoIP phones typically have a unique address built into them, you can take your phone and use it anywhere you find a broadband connection. And even if you don't have a VoIP phone, many providers allow you to access a web interface and make calls from any computer in any location in which a broadband connection and a microphone is available. If you travel for work, especially outside of the country, you can realize big savings when you don't have to use your cellphone to make international calls.
What are the cons of VoIP?
- Sound quality. Users of landline phones rarely experience sound problems during phone calls (unless there is an equipment malfunction). However, with VoIPs, sound quality can be problematic. As information is broken up into a series of packets and transmitted, the packets can be rearranged during the transmission. Because of that, the receiving VoIP must put them in the right order, causing delays and several seconds of silence in some cases.
- Low bandwidth can cause problems, including dropped calls, sound-quality issues and more. You can work with your VoIP provider to find the bandwidth you will need for a particular system, but expect the same broadband issues you experience with your computer or cellphone.
- Compatibility issues. Some systems only allow you to call people with the same VoIP service. Others won't allow PC-to-phone calls. Do your research to find the service that will meet all your needs, but as a business owner, you will likely need a VoIP that permits calling to any device or provider.
- Electricity is required. Unless you operate a cordless phone from your landline, when the power goes out, you still have a working phone. However, with VoIP, if you have no power, you have no phone either.
- Other services can't be bundled. With a landline, you can integrate digital TV subscriptions, digital video recorders and security systems. Currently, VoIP doesn't offer a way to integrate those services.
Bottom line: If your business is looking to save money, and you can handle the occasional disruption of service, the cost benefits of a VoIP will likely outweigh any quality issues you might experience.
What are some VoIP services to consider?
Offers nationwide calling with no monthly fees, except for standard taxes and costs. It receives rave reviews for performance and call quality. One drawback is that you must purchase hardware, including the Ooma Telo hub ($149.99) and additional handsets ($59.99), which can be costly. The company offers an Ooma office starter pack ($249.99), which provides an Office Base Station and two Linx devices supporting up to three extensions and 15 virtual extensions.
All domestic calls are free; however, international calls vary in price. Ooma does offer international plans: unlimited minutes to 61 countries for $17.99 per month or 1000 minutes to 61 countries for $9.99 per month.
Currently calls are still free in the U.S. and Canada (however, Google hasn't guaranteed that for the future), and you can use this service to call any landline or mobile phone from your PC. Gmail charges for international calls (ranging from $0.02 to $1.00 per minute). Some reviews indicate that sound quality isn't always clear. However, by signing up for the required—but free—Google Voice number, you gain the benefit of simultaneous ringing and voicemail-to-text and voicemail-to-email transcription.
In addition, you can call your Gmail contacts from within Gmail—on your computer, not your phone—and Voice Calls offers a free video-chat plug-in.
While a bit more expensive than other VoIP providers, Vonage's easy setup, sound quality, coverage and array of features make it one of the most popular choices out there.
Plans start at $14.99 for residential customers and $39.99 for businesses, plus taxes and fees. You'll pay a one-time $29.99 activation fee and a $9.95 shipping-and-handling charge. Vonage offers reasonable rates, starting at $0.03 for international long-distance calls.
Features include options for faxing capabilities (for an additional fee) and being able to transfer your existing number); each account offers free voicemail, call forwarding, transfer and waiting, three-way calling and more. Reviewers praise the easy setup and the ability to manage accounts through an online dashboard.
Services range from $19.99 to $49.99 per month, so it is a bit more expensive than some other providers. However, reviewers tout its strong voice quality and its many features, including conference calling, call forwarding, filtering and virtual numbers. You have the option of using your existing number or getting a new one.
With the service, you can indicate that you want to have emails sent to you when you receive a voicemail, or you can have the voice messages sent to you as an attachment. Additionally, using the Locate Me feature, CallVantage will attempt to call up to five different numbers should you not answer your phone.